Offshore savings plan? Here's what's changed since you signed up

I've spent over twenty years sitting across the table from international professionals who were sold an offshore savings plan early in their career abroad.

Most didn't choose it.

It was recommended to them, often by the only adviser they'd ever met, and they signed because it sounded sensible: save regularly, build a pot for the future, do it in a tax efficient wrapper.

The product itself isn't the problem.

The problem is that many legacy offshore savings plans were built for a market that has since changed. Transparent, low-cost investment platforms were far less accessible when you signed up than they are now.

If you're holding one of these plans and wondering whether it's still the right call, you're asking the right question. So should you keep paying into your offshore savings plan, stop it, or get out of it altogether?

Before the detail, the points that matter most if you're weighing this up from Dubai:

• An offshore savings plan is a long-term, regular-premium investment policy from an offshore life insurer, widely sold to expats in Dubai. What it charges, and what it costs to leave, decide whether it still earns its place.
• The decision comes down to two numbers. Every charge you'll pay between now and the end of the term, against the economic cost of surrendering the policy today. Where the former is materially bigger, leaving and reinvesting may put you ahead over the remaining years.
• Your provider can give you three figures in writing: the current fund value, the current surrender value, and the reduction in yield. The difference between the fund value and surrender value shows the immediate economic cost of surrendering the policy.
• Stopping the premiums and leaving the money invested can be a middle option. Some plans allow you to make a policy paid-up, though the terminology and the consequences vary. Some charge extra for it, and some treat a policy as dormant once premiums stop.
• The names have changed more than the products. Friends Provident International was acquired by International Financial Group Limited (IFGL) in July 2020. Generali Worldwide became Utmost Worldwide in February 2019, and Zurich's Vista is no longer available to new investors in the UAE.
• The advice matters as much as the plan. How the person advising you is paid, which entity provides that advice and which regulator covers that entity can affect your position as much as the product name on the policy.

What an offshore savings plan is, and where it came from

What is an offshore savings plan?

An offshore savings plan is a regular-premium, unit-linked investment policy sold through an offshore life insurance company, usually based in Guernsey, the Isle of Man or a similar jurisdiction. It's one of the most widely sold Dubai financial products for expats, even though the policy itself sits with an insurer in Guernsey or the Isle of Man.

You commit to paying a fixed amount each month for an agreed term, often ten, fifteen or twenty-five years. Part of each premium buys units in funds you select, while other costs are deducted according to the policy's charging structure.

It's marketed as a disciplined way to save and invest while living and working abroad. The structure can offer tax deferral, depending on where you're resident and on the circumstances of the policy.

The same structure can be sold as a contractual savings plan, a regular savings plan, an offshore pension or a regular savings account. For decades it was one of the products available to expats who had limited access to workplace pensions or domestic investment platforms.

Offshore doesn't automatically mean tax-free. The tax treatment depends on the policy jurisdiction, your country of tax residence and the type of policy. In some circumstances it also depends on where the policy is surrendered, or where benefits are taken.

Where the offshore savings plan came from

If you have a long memory, the structure will sound familiar. It's a direct descendant of the Maximum Investment Plan, or MIP, which had its heyday in the UK in the 1980s. The MIP was a unit-linked endowment policy: a fixed-term contract where part of each premium went towards life cover and the rest into investment funds, paying out a lump sum at the end of the term. Ten years was a common minimum term because of the tax treatment that applied to qualifying policies.

It was a genuinely new idea at the time. It was also, in time, a problematic one. High commission rates, opaque costs and concerns about sales practices contributed to widespread criticism of commission-led financial products.

The UK's personal pension mis-selling scandal ran alongside it. More than five million personal pensions were sold between April 1988 and June 1994. The Pensions Review, launched in 1994, then addressed cases where people had been wrongly advised to leave, opt out of or not join occupational pension schemes. An estimated two million people were affected, and the redress bill has been put at more than £10bn. The episode contributed to the UK's subsequent move towards greater scrutiny and tighter controls around financial advice and commission-led products.

The 2012 Budget introduced a £3,600 annual premium limit for new qualifying policies from April 2013. That significantly curtailed the market for new high-premium MIPs. Existing policies and transitional arrangements continued, but the traditional MIP became far less relevant to new investors.

What survived was the structure, and similar long-term, insurance-based investment products continued to be sold offshore to international professionals.

Why these plans suit fewer international professionals than they used to

Long-term saving for your children's education or your own retirement is one of the most important financial decisions you'll make as an expat. A lot of what's sold to international professionals is still built around a long-term contractual structure.

The core issue isn't malice. Commission-based remuneration remains common in parts of the expatriate financial-advice market. And expats, often new to a country, new to its tax rules and short on local financial connections, rarely have the time or the network to research properly what they're being sold.

That imbalance of information and trust is where problems can arise.

You trust the adviser because they're the only one you know. You don't ask enough questions, because you don't know which questions to ask. By the time the annual statement reveals the real effect of the charges, you're several years into a term that's expensive to exit.

What an offshore savings plan costs, and what it costs to leave

How much does an offshore savings plan actually cost?

This is the question that matters most, and it's rarely answered clearly at the point of sale. Offshore savings plans can stack four or five separate charges on top of each other:

• An initial or establishment charge, which on some legacy plans is applied to units bought with the first eighteen to twenty-four months of premiums. On some well-known legacy plans this can be around 4% a year and can continue to be recovered over the policy term.
• A fixed policy or administration fee, a flat monthly or quarterly amount, which bites hardest on smaller plans.
• An annual management charge, which may apply to the policy value.
• Fund charges, the ongoing cost of whatever you're invested in.
• Mirror fund costs. Some plans give you the insurer's copy of a fund rather than the underlying fund itself, with an additional charge on top.

The exact structure varies significantly between providers and policies, so the policy-specific charging schedule matters more than any generic figure.

The bigger cost is compounding.

A four per cent annual charge doesn't sound dramatic on its own. Here's what different levels of annual charge take out of a pot over ten and twenty years, before any difference in investment performance:

That's my own calculation, and it's an illustration rather than a projection of your plan. It assumes the charge applies to the whole balance each year, and that the investments return the same before charges. It's not saying that an offshore savings plan necessarily charges 4% annually on the whole portfolio. The purpose is simply to illustrate the mathematical effect of different annual percentage drags. Any examples used are for illustrative purposes only, and you may get less back than the figures shown. Your figures will differ. Your capital is at risk either way.

Run the comparison side by side over two decades and the gap between a high-charge plan and a low-cost platform can become substantial. The impact depends on the starting balance, contributions, investment return, charges and time horizon.

The single figure worth asking your provider for is the reduction in yield, or RIY. It expresses the effect of the policy's charges as an annual reduction in investment return, based on the assumptions in the policy illustration. That makes it useful for comparing the cost of one arrangement against another.

What happens if I want to exit my offshore savings plan early?

This is usually the part nobody explained properly at the start. Many offshore savings plans are built around a fixed term, and some have charging structures that recover initial costs and adviser remuneration over the policy term.

Stop paying or try to cash in before the end of that term and you'll typically need to understand both the surrender value and the contractual consequences. On some legacy plans, the economic cost of surrender can be particularly significant in the first few years, with the impact reducing as the policy matures.

If you're sitting on one of these plans today, that cost is the real decision point. It's not a reason to assume you're stuck. It's a reason to work out, properly, whether the remaining term inside the existing structure costs you more than taking the exit cost now and reinvesting in something cheaper.

How to review your offshore savings plan

A savings plan review doesn't need an adviser to get started. You can do most of it yourself in an afternoon. It's worth having the numbers in front of you before anyone offers an opinion on them.

What should I check before deciding what to do with my plan?

1. Name the plan and the provider. Both are on the policy schedule and on every annual statement. If the name on your statement has changed, that may simply reflect a corporate acquisition or consolidation.

2. Work out how far through the term the plan is. Start date, end date, monthly premium, years still to run. Everything else depends on those four.

3. Ask the provider for the current fund value and the current surrender value, in writing. The difference between them shows the immediate economic cost of surrendering the policy. It's worth asking for the date any surrender charge falls away, and what the surrender value would be in one, three and five years' time.

4. Ask for the full charging schedule and the reduction in yield. Every charge, named, with the basis it's calculated on. If the answer comes back vague, ask again in writing.

5. Look at what you actually own. The funds, their ongoing charges, and how each has done over five and ten years against a relevant index. Concentration in a handful of expensive or illiquid funds is worth flagging, as is the use of mirror funds carrying additional costs.

6. Model the two futures. The cost of staying to the end of the term, against the one-off cost of exiting plus the lower running cost of an alternative over the same period. This is the step most people want help with, because it turns on assumptions about return, inflation and how long the money stays invested.

Should I keep the plan, make it paid-up, or exit?

Your investment exit options come down to two, plus the choice to stay put. Three outcomes, and the conditions that tend to point to each. This is general information rather than a view on your plan.

Keeping it can make sense late in the term. The remaining charges are modest, the surrender cost still bites, and the funds are doing a reasonable job. Sometimes the cheapest route through a poor structure is out the far end of it.

Making the plan paid-up means stopping the premiums and leaving the existing money invested until the surrender cost falls away or the term ends. It stops you feeding new money into a high-charge structure while potentially avoiding the worst of the surrender hit. Check the terms first. Some plans apply extra charges to paid-up policies, and some treat a policy as dormant after a set period of missed premiums.

Exiting can make sense when the surrender cost is small or has already fallen away. It can also make sense when the drag over the remaining years is clearly bigger than the one-off cost of leaving. You take the cost of surrender, reinvest at a lower cost if appropriate, and keep the monthly saving habit without the same contractual structure.

On some legacy plans with terms over fifteen years, most or all of the first eighteen months to two years of premiums can be at risk on early surrender. The precise position varies by policy and the economic cost generally changes as the policy matures. That's the number that decides this, and it's specific to your policy.

How to check an adviser is independent and properly regulated in Dubai

This can matter as much as the product itself. If you're weighing up independent financial advisers in Dubai for expats holding legacy plans, three checks are worth making.

Which regulator covers financial advice in the UAE?

Several regulators can be relevant to financial advice in the UAE. Which one applies depends on where the adviser is licensed, which legal entity provides the service, and what that entity is permitted to do.

• The Central Bank of the UAE (CBUAE) oversees banks and a range of financial and insurance activities onshore, including the regulation of insurance brokers.

• The Dubai Financial Services Authority (DFSA) regulates financial services conducted in or from the Dubai International Financial Centre (DIFC). That includes advising on and arranging investments, where the licence permits.

• The Financial Services Regulatory Authority (FSRA) regulates financial services conducted in or from the Abu Dhabi Global Market (ADGM).

• The Capital Market Authority (CMA) is the UAE's federal capital-markets regulator. It succeeded the Securities and Commodities Authority (SCA) from 1 January 2026 under the UAE's new capital-markets legislation.
  

The UK's Financial Conduct Authority sits alongside these for any UK-regulated business, which matters if part of your financial life is still in Britain.

How do I check a Dubai financial adviser is licensed?

Ask for the legal entity name and the licence number of the firm you'd actually be contracting with, then look it up on that regulator's own register. Dubai financial advisers can operate under different regulatory regimes, and the licence and permissions held by the relevant entity determine the regulatory protections that apply.

Brand names, group names and website names aren't licences. One brand can cover several entities with different permissions, and the entity on your paperwork is the one that carries the obligation to you.

What should I ask about how an adviser is paid?

Independence comes down to three things. Whether the adviser can look at the whole market or only a panel. Whether they're paid by you or by the product provider. And whether they'll put the answer in writing.

Questions worth asking before you sign anything:

• How are you paid on this recommendation? Initial commission, ongoing commission, a fee, or some combination?

• What does that come to in dirhams or pounds, in year one and over the full term?

• What do you receive if I stop paying in year three?

• Are you restricted to a panel of insurers or platforms, and who's on it?

• What are the total product charges, expressed as a reduction in yield?

• If I complain, whose process applies, and what redress exists there?

That last one catches people out. Where a UAE-regulated entity provides the advice rather than a UK-regulated firm, UK protections and access to the Financial Ombudsman Service generally won't apply to it. The applicable UAE or financial-free-zone regime determines the complaints and redress arrangements instead.

Then there's the pattern worth noticing. An introduction through a friend of a friend. A free review that arrives at a product. Pressure to sign in the first meeting. Commission quoted only as a percentage. A long fixed term presented as discipline rather than as a lock-in.

None of that proves bad faith. It does mean the incentives deserve a look before the recommendation does.

What if I also hold a UK pension?

The same questions around remuneration, regulation, charges and the purpose of a recommendation run through UK pension advice for UAE expats.

If someone has approached you about moving a UK pension into a QROPS or an international SIPP, the same four tests hold. Which entity is regulated, and by whom. How the adviser is paid. What the total ongoing charge comes to. And what the transfer achieves that your existing scheme can't.

UK defined-benefit pension transfers are subject to specific UK regulatory requirements where the advice falls within the FCA regulatory perimeter. The destination product is rarely the first question worth asking.

What's changed in the offshore savings plan market

How do today's offshore savings plan providers compare?

The major providers have consolidated significantly over the past decade, though many of the underlying product structures remain familiar.

• Friends Provident International was acquired by International Financial Group Limited (IFGL), the owner of RL360, from Aviva, with the transaction completing in July 2020.

• RL360, based in the Isle of Man, still offers regular savings products and sits within the IFGL group.

• Hansard International remains active in the regular-premium space.

• Zurich International Life closed its Vista plan to new investors in the UAE. Zurich's Middle East business now offers a Regular Savings Plan with a shorter initial charging period, from USD 500 a month over a minimum of five years.

• Generali Worldwide, a name many expats still have on their original policy documents, was acquired by the Utmost Group and renamed Utmost Worldwide in February 2019. It now sits under the wider Utmost International umbrella. Generali's UAE branch stopped accepting new regular-premium business from Dubai advice firms in March 2019. If your statements still reference Generali, that's why the name on your annual review letter may have changed.

Many legacy plans share the same characteristics. Significant entry and exit costs. Contractual terms less flexible than a modern investment platform. Investment structures that can carry additional fund or mirror-fund charges.

None of this makes these providers illegitimate insurers. They're established life companies operating within their respective regulatory regimes. It means the suitability of a particular product needs to be considered against the alternatives now available.

What's changed to make better alternatives possible?

The investing world has moved a long way since the regular savings plan was one of the few options available to an international investor.

Open-architecture investment platforms can now give access to thousands of funds rather than a restricted panel chosen by the insurer. Costs have come down as the industry has digitised. And critically, there's no longer a need to lock yourself into a fixed term simply to get the discipline of regular saving. You can build the same habit, monthly contributions, automatic investing, a long-term plan, without necessarily taking on the same contractual surrender structure.

It's the same shift you've seen elsewhere. Products that once solved a genuine access problem can become less compelling once better alternatives arrive.

Nobody's defending a Nokia 3310 anymore. The offshore savings plan deserves the same honest reassessment.

Why a cheaper platform on its own isn't a plan

Moving from a high-charge policy to a low-cost platform fixes the charge. It leaves the harder questions exactly where they were.

How much do you actually need, and by when? Where will you be tax resident when you start drawing on the money? What happens to a UK pension you still hold, and to property in two countries? Whether the money is for school fees in six years or for a retirement that starts in twenty.

Most of the expatriate wealth management market answers those questions with a product, because a product is what it's paid to place.

AES is paid for judgement instead, as the only certified investment fiduciary across Asia, the Middle East and Africa. The work is delivered as Financial Life Management: purpose first, then the plan, then the portfolio that funds it. The charge question sits inside that, along with pension and investment advice, protection, structures and the order you do things in.

It won't suit everyone. AES isn't the lowest-cost option, and if what you want is a single product placed quickly, there are better-fitting firms for that.

Where this leaves you

Offshore savings plans aren't a scam, and not every adviser who sells them is acting in bad faith. But many legacy products were built for a market that has since changed. Low-cost, transparent platforms are far more accessible now than when most of these plans were sold.

That market has moved on. If you took out your plan more than a few years ago, it's worth finding out, properly, whether it's still the right place for your money or whether you're paying a legacy price for a legacy product.

Large numbers of international professionals still hold these plans, including many legacy policies taken out a decade or more ago. The product may well have been the right, or only, option available to you at the time. That doesn't settle whether it's the right one today.

The honest answer depends entirely on your specific plan: how far through the term you are, what the surrender value actually looks like in pounds and pence, how the underlying funds have performed, and what you're trying to achieve with the money. There's no universal verdict that applies to every offshore savings plan, which is exactly why a proper review matters more than a generic opinion.

AES offers an independent expert review for clients who meet its current investment-asset criteria, and the criteria are set out on the review page. The review looks at one thing: whether your current arrangement is still serving you. The real cost of staying versus the real cost of leaving, the alternatives available, and whether change is worth it once every number is accounted for.

Sometimes the answer is to stay put.

Often it isn't.

Either way, you should be making that decision with the full picture in front of you, not the partial one you were given at the point of sale. As with most things involving capital at risk, the right answer depends on your full circumstances, and your capital is at risk regardless of which structure you choose.

If you'd like to talk through your offshore savings plan and what your options actually look like, book a 15-minute discovery call.

This communication is a financial promotion intended for information purposes only and does not constitute financial advice.

Common questions about offshore savings plans